The South Bay housing market continued its slide in February, with some communities seeing a double-digit drop in home prices, according to a report released Monday.

Excluding the Palos Verdes Peninsula, the South Bay saw its median home price decline 7 percent last month, compared to a year earlier, said the report by the Los Angeles-based California Association of Realtors.

That brought the area’s median – the middle figure where half of homes sold for more and half sold for less – to $600,000 for February’s median price.

The decline erased the area’s January increase of 0.4 percent as fewer houses were selling and fewer buyers were looking.

The Palos Verdes Peninsula saw a drop in median price of 0.4 percent to $1,150,000. But so few homes sold on The Hill that none of its four cities were individually cited.

A city or community must sell at least 30 homes during the month to be cited.

Manhattan Beach, one of the highest-priced cities in California, also was left off the list of communities. That was the case with Hermosa Beach, El Segundo and inland areas such as Lawndale, Lomita, Carson and Gardena.

Gardena’s absence from the February report was unusual since the city usually meets the 30-home threshold.

Gardena and Carson will see tough times as many homeowners with adjustable-rate mortgages can expect loans to reset higher, Pasquel said.

“I think this is just a first wave of problems,” Pasquel said. “This is just the first wave of mortgages to reset. So we have ’09 and ’10 to deal with. So I really hope that the government can do some sort of freeze on mortgages that are about to reset. That would really help.”

Pasquel noted that the housing markets in inland cities such as Carson and Gardena differ significantly from the more affluent beach cities. Inland cities often draw first-time home buyers, who needed adjustable-rate mortgages and zero-down payment programs to afford homes during the real estate boom.

For February, Redondo Beach saw a price drop of 12.7 percent to $655,000. San Pedro was down 12.4 percent to $438,000. Hawthorne fell 10.9 percent to $482,750.

Torrance’s drop was in the single digits, at 5.3 percent to $539,250.

Yet the beach cities as a whole – including El Segundo, Hermosa Beach, Manhattan Beach, Redondo Beach and Playa del Rey – saw the median price rise 22.5 percent. That rise is consistent with a similar increase in January as some newer, more expensive homes have been selling.

Realtor John Parsons warned that the monthly median prices can vary widely, depending on homes sold.

For example, a 191-unit senior housing project near the South Bay Galleria could lower Redondo Beach’s median home price, he said.

“It’s at the low end of the market,” said Parsons of Horrell Realtors in Redondo Beach. “The average unit is probably in the (mid-$400,000) range. So these things are quite a bit below the median. If enough of these pass escrow, it could cause the median in Redondo to hit the floor. But it won’t affect my home value.”

Parsons, a Redondo Beach planning commissioner and former councilman, said that home sellers are becoming more realistic as the housing market continues to decline.

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